China

The Evolving Urban Form: Nanjing

Wendell Cox — Thu, 18 Apr 2013 01:38:59 -0400

Nanjing is one of China's most historic cities. It is one of the four great ancient capitals of the nation, along with Beijing, Chang'an (Xi'an) and Luoyang. Its name means southern capital (Nan=south, Jing=capital), while the name of the current capital, Beijing means Northern capital. Nanjing was the national capital at various times, however generally for periods of no more than a few decades. Upon the establishment of the People's Republic of China, the national capital was moved permanently to Beijing, where it had been for most of the previous five centuries.

Nanjing is the capital of Jiangsu, which is China's fifth most populous province. It has twice as many people as California (80 million) and a land area the size of Virginia. Nanjing is also one of the "four furnaces" of China, a title derived from its humid summers. The others include Wuhan (Hubei), Chongqing and sometimes Changsha (Hunan) or Nanchang (Jiangxi).

Nanjing is reputed to have the world's longest, though not the oldest surviving city wall, which was built in the 14th century (Photo). The city is also the site of the second bridge ever built over the lower Yangtze River (Photo), opened in 1968 (the first was at Wuhan). The bridge carries both automobiles and trains. There are now five Yangtze River crossings in Nanjing.

Nanjing City Wall

Yangtze River (toward suburban Pukou qu)

Yangtze Delta Megalopolis

Nanjing is a big city in one of the world's great urban mega-regions. It serves as the Western anchor of the Yangtze Delta region, a megalopolis (string of metropolitan areas) which consists of a string of sometimes adjacent urban areas, stretching through Suzhou to Shanghai and Hangzhou to Ningbo, with a population of approximately 60 million (plus additional millions in rural areas, outside the urban areas). This is at least a third more than live in the longer Washington-New York-Boston corridor, the original megalopolis.

A trip through the Yangtze Delta corridor demonstrates only comparatively short sections that are not urbanized. One of the longest is the 10 mile (16 kilometer) section from the eastern urban fringe of Nanjing to the western fringe of Zhenjiang (location of the Pearl S. Buck Museum). Further, Nanjing's southern fringe now meets that of Maanshan, in Anhui province (not a part of the Yangzte Delta).

The Nanjing Urban Area

Nanjing has grown rapidly. In 1950, the urban area population was approximately 1.0 million (see "Definition of Terms Used in the Evolving Urban Form Series"), a population some sources say was exceeded in the 15th century. The urban area has now reached 5.8 million. Nanjing is the world's 59th largest urban area and the 13th largest in China. It is projected to have a population of more than 8 million by 2025 (Figure 1). The Nanjing urban area (Figure 2) covers approximately 440 square miles (1,140 square kilometers). This results in a population density of approximately 13,100 per square mile (5,100 per square kilometer).

Consistent with the general principle that cities become less dense as they get larger, Nanjing's population density has fallen significantly over the last 60 years, even as its geographical size has more than quintupled (Figure 3). Older historic land area data is not readily available, but if it is assumed that virtually all of Nanjing's United Nations reported 1,000,000 population in 1950 lived within the 17 square mile (44 square kilometer) periphery of the city walls, the population density would have been more than 60,000 per square mile (more than 23,000 per square kilometer). The area within the city walls is indicated by green shading in the urban area representation (Figure 2).

By 1970, the population had increased to over 1.4 million and if this population was contained inside the city walls, the population density would have approached 90,000 per square mile (35,000 per square kilometer).Indicating a similar density, the 2010 population of the most densely populated district (Golou qu), much of which is located inside the Wall 86,000 per square mile (33,000 per square kilometer).

The Nanjing Metropolitan Area

Nanjing is a prefecture (regional municipality) with 11 districts, of which nine are in the metropolitan area (Note 1). The core of Nanjing continues to grow, from 2.5 million in 2000 to 3.4 million in 2010, an increase of 34 percent (Note 2). But in comparison, the suburban districts grew from 2.3 million to 3.8 million, an increase of 64 percent (Figure 4). For the first time, suburban Nanjing has a larger population than the urban core. The suburbs accounted for 64 percent of the metropolitan area's growth over the past decade, compared to 36 percent in the urban core (Figure 5).

Pukou, a suburban district across the Yangtze River from the historic location of Nanjing, was by far the fastest growing part of the metropolitan over the past decade. By 2010, the population had risen to 710,000 from 225,000 in 2000, when it was largely rural. Two metro lines are planned to connect Pukou to the rest of the urban area, which is likely to encourage further suburban development.

The Nanjing Economy

Nanjing, like other cities in China, has been a beneficiary of China's unprecedented poverty reduction, first launched by the economic reforms started by Deng Xiao Ping in the early 1980s. It is estimated that in 2012, Nanjing's gross domestic product per capita (purchasing power parity adjusted) was approximately $25,000 annually. Nanjing's GDP per capita is compared to that of other Chinese metropolitan areas and examples from the developed world in Table 6 (Note 3).

A Strong Future

Nanjing seems likely to continue its strong growth. This and Nanjing's geographic location in one of the most vibrant mega-regions in the world should guarantee a continuing and strong contribution not only to the development of the Yangtze Delta megalopolis, but also to economic progress of China as a whole.

Wendell Cox is a Visiting Professor, Conservatoire National des Arts et Metiers, Paris and the author of “War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life.

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Note 1: The districts (qu and counties) designated as urban by Nanjing prefecture (regional municipality) authorities Entire peripheral districts are designated when they begin to receive urban development. The "urban" designation in China, however, does not indicate continuous urbanization and is thus not an urban area in the internationally defined sense. The Chinese urban definition is thus similar to a metropolitan area (labor market).

Note 2: The urban core includes the following districts (qu): Xuanwu, Biaxia, Qinhaui and Gulou.

Note 3: Estimated the Brookings Institution Global Metro Monitor, and other sources. See "World's Most Affluent Metropolitan Areas: 2012" including the "Note."

Top Photo: Zifeng Tower (all photos by author)

The California-China-CO2 Connection

Bill Watkins — Wed, 16 Jan 2013 00:38:00 -0500

Michael Peevey, President of the California Public Utilities Commission, is sincere and concerned about CO2 emissions. At a recent presentation at California State University Channel Islands, he spoke about California’s efforts to limit emissions. He mentioned green jobs, but, to his credit, he did not repeat the debunked claim that restricting CO2 emissions will be a net job creator. He also acknowledged that it doesn’t much matter what California does, if China doesn’t change its behavior. It turns out that if California were to reduce its carbon emissions to zero, in about a year and a half global CO2 would be higher anyway, just because of the growth in China’s emissions.

Peevey talked about California's increasingly ambitious plans for carbon reduction in the future. The goals include returning to 1990-level CO2 emmisions by 2020, and then an 80 percent reduction by 2050, regardless of population changes.

This is going to be expensive. And the price of some of the potential technology — such as capturing atmospheric CO2 and pumping it underground — will include a lot more than the direct cost. The ultimate costs will, unfortunately, include increased global CO2 emissions.

Some readers will remember the first time Larry Summers, the former US Treasury Secretary (under Bill Clinton) put his public career at risk because of his bluntness. In 1991, while Chief Economist at the World Bank, Summers gained international notoriety by saying in a memo, "I've always thought that under-populated countries in Africa are vastly under polluted."

That was the first of many times that lots of people demanded his head. He's since claimed that it was sarcasm, but I don't believe it. I believe he meant that environmental quality is a luxury good; that poor people need things like food and shelter, and they don't much care if they trash the environment in the process. So, if pollution were localized, the poor would gain jobs and the wealthy would have an improved environment. Presumably, each would be happier.

Of course, that sounds terrible to most people. But that's precisely what we are doing here in California, only we’re doing it worse.

California, by making production so very expensive, is chasing producers to places with low pollution controls. It's worse than the situation Summers describes, because carbon dioxide emissions do not remain local. They spread throughout the atmosphere. Perversely, California is causing a global increase in CO2 emissions by its regulations limiting CO2 emissions in California.

The problem is the result of acting on the concept of Think Globally and Act Locally (TGAL). TGAL works when pollution is local. But when air pollution is free to float around the world, you have to have a different strategy, and get the most reduction for your investment.

And you don’t get the most for your investment in California. In terms of carbon efficiency — the ability to generate output while emitting less CO2 — California is one of the world’s most efficient economies. Each new reduction in CO2 becomes increasingly expensive. That is, reducing emissions is subject to increasing marginal costs. Reducing carbon emission in California is really expensive because we’re so carbon efficient already. Reaching the 2050 goal will be incredibly expensive. Worse, it won’t do any good.

It’s not as if California can really afford it. Last month, I participated in the South Coast Association of Governments (SCAG) Third Annual Economic Summit. This great event provided lots of information about the economic challenges facing Southern California. For example, we learned that Los Angeles County’s economy will probably not reach its pre-recession level of jobs until at least 2018 and perhaps not until 2020.

That’s a sobering thought.

California State Sen. Roderick Wright, D-Los Angeles, a powerful speaker, documented California’s industrial decline, and made an emotional appeal for polices that produce jobs. The audience gave Wright a rousing ovation, something quite rare at economic conferences. The problem is that the audience was comprised of economic development people. Too bad no one else was listening. It was poorly attended by policy makers. There were only a handful of elected officials.

California’s economy is struggling, even if many in the political class refuse to acknowledge the fact. Because of that, our investments need to be wise. The correct strategy for California is global. We need to go looking for the low hanging fruit.

The low hanging fruit is mostly in developing countries like China, India and Brazil. We've tried to get them to cut their emissions at Kyoto and the like, but they refused, pointing out that they are much poorer than the West, and that we were able to develop with lower-cost polluting industries. They have a point.

We should help them cut their carbon emissions. Reducing a ton of CO2 emissions is far cheaper in China than in California. So, let’s reduce it there.

There are political problems with this proposal. California’s carbon regulations were sold to the people on the absurd claim that the regulations would be profitable: better than low cost, better than a free lunch.

The bigger problem would be convincing California voters to tax themselves to clean up Chinese factories. That seems to me to be an information dissemination problem. If Californians knew the true cost of the existing program, and how little reduction in global CO2 concentrations it brings, they might logically be willing to look at other approaches. If they knew how much more effective a dollar spent on Chinese emissions was than a dollar spent on California emissions, they might seriously consider the proposal. The proposal could always be sweetened by requiring that all the work be done by California companies.

It would be good for Californians. It would be a big step towards restoring California’s economic vigor. It would make a serious dent in global CO2 concentration. It would be less costly than our current plan.

Let’s do it.

Bill Watkins is a professor at California Lutheran University. and runs the Center for Economic Research and Forecasting, which can be found at clucerf.org.

Flickr photo by doc tobin: Smog on the Great Wall.

Want to See Better US-Chinese Relations? American and Chinese Millennials Could Be Key

Morley Winograd and Michael D. Hais — Mon, 17 Dec 2012 00:38:38 -0500

While it is still fashionable for politicians in both China and the United States to prove their domestic leadership credentials by taking tough stances against their nation’s chief economic rival, the results of recent Pew surveys conducted in the two countries suggest that this type of rhetoric is a holdover from an earlier era. An examination of the beliefs among the youngest generational cohorts in each country shows a distinct lack of the ideological vitriol so common in the 1960s and 1970s. As a result, we might see a far more congenial relationship between the world’s two great powers --- at least once the older generations fade away.

Let’s hope so, because older generations sometimes seem more committed to discord than accord. During the 2012 US presidential campaign both President Barack Obama and Governor Mitt Romney took full advantage of opportunities to criticize their opponent for the softness of his approach to China. Xi Jinping, who was named the General Secretary of the Chinese Communist Party about a week after Obama was reelected and will become China’s Premier early next year, has been no less willing to rhetorically censure the United States.

Yet the Pew research indicates that the youngest generational cohort in both the US and China holds positive attitudes toward and favors contact with the other country. In the United States that youthful cohort is the Millennial Generation (born 1982-2003), America’s largest and most ethnically diverse and tolerant generation to date. Of the 95 million US Millennials, about four in ten are nonwhite and one in twenty is of Asian descent, with Chinese-Americans comprising the largest portion of that segment. By contrast, among U.S. seniors and Boomers, only about one in five is nonwhite and about two-percent of Asian heritage.

Generational theorists have not definitively named the Millennials’ Chinese counterparts. Some observers, however, have called at least their urban segment “Little Emperors.” Similar to American Millennials, this generation was often reared by their own hovering “helicopter parents” in a highly protected, hyper-attentive manner that reflected the importance of these special children—the product of China’s “one child” policy—and the great expectations their parents had and continue to have for their offspring. The result of this upbringing are cohorts of civic-minded, pressured, conventional, patriotic American and Chinese young people who revere their parents, are optimistic about their nation’s future, and open to the world.

In China, the Pew research, conducted in March and April, 2012, contained a battery of questions probing attitudes toward the United States, its interactions with China, and its influence on Chinese society. Across all of these questions, the youngest cohort (18-29 year olds) held significantly more favorable opinions about America than older Chinese. Given that Chinese who are 50 or older include generations that established the Communist regime in 1949, fought American troops in Korea, and were part of the ideological Red Guards of the 1960s, this is not altogether surprising.

Overall, a majority (51%) of China’s youthful cohort held a positive view of the U.S. as compared with only 38% of older Chinese. More specifically, majorities of 18-29 year olds said they admired American technological and scientific advances (77%), American ideas about democracy (59%), U.S. music, movies, and television (56%), and agree that it is good that American ideas and customs are spreading to China (50%). Across all of these dimensions favorable attitudes toward the United States and its influence were at least 15 percentage points higher among the youngest Chinese cohort than the oldest. In only one area, the American way of doing business, did less than a majority of 18-29 year old Chinese (48%) indicate admiration of the United States; even on this dimension there was a 12-point gap between the positive opinions of younger and older Chinese respondents.

Pew did not ask the same questions in its American surveys that it did in the Chinese study. However, it did examine many of the same dimensions permitting valid comparison of survey results in the two countries. In a November 2011 survey examining the large generation gap in U.S. politics Pew asked if it was better for the United States to build a stronger economic relationship with China or to get tough with China on economic issues. American Millennials, a generation corresponding to Chinese 18-29 year olds, overwhelmingly favored a policy focusing on building stronger trade relations with China rather than one based on toughness (69% to 24%). By contrast, a plurality of the two oldest American generations—Boomers and seniors—believed that a tougher approach instead of closer economic ties with China was best (48% to 45%). These results reflect the far greater support of Millennials than older generations for free trade agreements overall (63% to 42%).

In its April 2012 Values survey, Pew examined the openness of Americans to “foreign,” if not specifically Chinese, influences. In one question, respondents were asked to agree or disagree with the statement: “It bothers me when I come in contact with immigrants who speak little or no English.” Only 32% of American Millennials compared to 44% of all older generations agreed. In another item Pew asked for agreement or disagreement with this statement: “the growing number of newcomers from other countries threatens traditional American customs and values.” Only four in ten Millennials (41%) as compared with a majority (53%) of Boomers and seniors agreed.

American Millennials are a generation that seeks to resolve disputes and conflicts by searching for win-win solutions rather than absolute victories over their opponents. Recent research suggests that their Chinese counterparts share many of the same attitudes. This bodes well for relations between their two countries in coming decades. The big question for the more immediate future is whether older generations in America and China will be able and willing to set aside the attitudes based on the ideologies and policies of the past long enough for Millennials on both sides of the Pacific to forge a new, less contentious relationship.

Morley Winograd and Michael D. Hais are co-authors of the newly published Millennial Momentum: How a New Generation is Remaking America and Millennial Makeover: MySpace, YouTube, and the Future of American Politics and fellows of NDN and the New Policy Institute.

Shanghai photo by Bigstock.

China's Second-Tier Cities: Sichuan Rises

Chris Devonshire-Ellis — Mon, 03 Dec 2012 00:38:03 -0500

Recent media attention has focused on a slowdown in China. The actual state of play in China that should be watched, though, is rather different. While residents of first and second-tier cities such as Shanghai, Beijing and Shenzhen can still be seen holding Louis Vuitton bags and iPhones, a significantly larger, yet less individually affluent, market has begun to rise within the country. It is within this terrain of lower-tier cities that China’s breakneck growth is now being demonstrated. It’s still a bit too early for these residents to be showing off designer handbags and Apple gimmickry, yet a solid and highly-sustainable growth wave is happening across China’s fourth, fifth, and sixth-tier cities in the central and western regions.

Here are some examples, in terms of rough population equivalents:

While many readers are familiar with most of these American and European cities, hardly any know their Chinese counterparts. And all of the Chinese cities in the chart above are in just one province – Sichuan.

When one factors in Shanxi, Henan, Hubei, Hunan, Anhui, and Jiangxi in Central China, and Gansu, Guizhou, Ningxia, Qinghai, Shaanxi, Yunnan and Xinjiang in West China, the sheer vastness of China’s own emerging markets becomes apparent. There are some 500 cities across the region with populations similar to those listed above.

What’s happening in these lower-tier Chinese cities? The local populations are now becoming more affluent. Crucially, this is a phenomenon driven by state policy, as Beijing wishes to reduce the national East-West income gap and raise the standards of wealth across the country. It has been doing this by embarking on an aggressive policy of increasing minimum wages on a national basis, and especially so in the hinterlands. That is having the effect of increasing disposable income levels, and these consumers are now upgrading purchases from previously purely Chinese brands towards increasing levels of Western products.

This includes the use of fast-food chains such as McDonald’s, KFC and Starbucks; massive multi-brand retailers such as Wal-Mart, Carrefour, and others that are also making inroads into these further-flung destinations. The Louis Vuitton bag may still be the preserve of China’s super wealthy in Shanghai, but in cities such as Mianyang, youths are trading up their cheap Chinese sneakers for Nikes, and looking to acquire Levis instead of the local jeans. With these consumer patterns being duplicated across the rest of China’s inland provinces, the result is little less than a revolutionary 'upgradation' of inland consumer power.

The other markets in China worth keeping an eye on are those located along China’s borders. I wrote about Urumqi as a springboard for Central Asia recently. Developments elsewhere in Asia dictate that other border areas will also begin to experience significant growth, not least because of the Association of Southeast Asian Nations’ (ASEAN’s) full free trade agreement that is set to abolish tariffs between member nations by 2015.

ASEAN includes countries that rub up alongside China’s southwest border, such as Myanmar, Vietnam and Cambodia, and adds to that countries including Laos, Malaysia, and Thailand, while to the south of China (and Guangdong Province in particular), ASEAN nations such Indonesia and the Philippines provide easy access. Why is this important? Because China has its own free trade agreement with ASEAN, and those 0 percent export tariffs among ASEAN nations are largely duplicated within China’s own agreements with the bloc.

That means cities such as Jinghong and Luxi in Yunnan are also poised to become trade hubs. Jinghong, with a population of 520,000 is equivalent in size to Tuscon, Arizona and Sheffield in the United Kingdom, and borders Vietnam, while Luxi borders Myanmar, and with a population of 350,000 is similar in size to Tampa, Florida or Bilbao.

Demand from the West does continue to remain sluggish, and inattentive analysts like to point to a drop in national GDP growth rates as evidence of some sort of cataclysmic event concerning development in China. That is only one, rather blinkered way of assessing the situation. Since China’s annual growth has moved briskly along at 10 percent for much of the past 15 years, a deviation from that is greeted by analytical soothsayers with cries of doom. Yet China’s 10 percent growth was never capable of being sustained, as each successive year of double-digit growth has, naturally, expanded the base to the point where it is now the world’s second-largest economy.

China’s national GDP rates have slipped to between seven and eight percent, and it may be experiencing a “slowdown” to single-digit GDP growth when measured on a national basis. But the real story is the continued fast-paced development of wealth, disposable income, and increasing consumerism in China’s own emerging markets and the fourth, fifth and sixth-tier cities that help make up this this gigantic consumer sector. The challenge for the foreign investor will now be to reach out and go after these less glamorous locations.

Chris Devonshire-Ellis is the founder of Dezan Shira & Associates. His clients include North American-based legal and tax firms, chambers of commerce, commercial trade institutions and universities. Following a 26-year career based in Asia, including 20 in mainland China, Chris is now based in North America and oversees client development and investment strategies for U.S. corporations looking to invest in China, India and Emerging Asia.

Flickr photo by Ken Larmon: Downtown mall in Mianyang, Sichuan.

Decline Of The Asian Family: Drop In Births Threatens Economic Ascendancy

Joel Kotkin — Tue, 23 Oct 2012 17:37:53 -0400

In the last half century, East Asia emerged as the uber-performer on the global economic stage. The various countries in the region found success with substantially different systems: state-led capitalism in South Korea, Singapore and Japan; wild and wooly, competitive, entrepreneur-led growth in Taiwan and Hong Kong; and more recently, what Deng Xiaoping once described as “socialism with Chinese characteristics.”

But these countries shared one common element: a strong Confucian family ethos. Three of Confucianism’s five key relationships are familial, led by the all-important father-son tie. In East Asia, business has often been driven by familial concerns. Hard-driving “tiger Moms” or workaholic Dads sacrificed all for the benefit of the next generation. But now that foundation is beginning to crumble, and if the trend is not reduced, the 50-year-long ascendency of the region could be threatened.

The signs of an emerging Asian malaise can be seen in slowing economies — in Japan’s case an almost two-decade-long stagnation. South Korea and Singapore may grow this year at levels approaching that of the United States — mediocre by their historic standards. The notion of assured further progress is fading, as populations age and domestic markets seem unlikely to expand much.

This malaise is reflect in declining birthrates, which now rival southern Europe for the world’s lowest, as demonstrated in a new report by myself and colleagues at the Singapore Civil Service College. Equally troubling, up to a quarter of all East Asian women, estimates the National University of Singapore’s Gavin Jones, will remain single by age 50, and up to a third will remain childless. Since few Asian women, unlike their North American or northern European counterparts, have children out of wedlock, the overall effect on already poor demographics could be catastrophic.

The reasons for this decline in marriage and family are complex. Demographers such as Austria’s Wolfgang Lutz see a reinforcing pattern in which singleness becomes normative and child-rearing more difficult, and less widely supported by society. This creates, as my Singaporean colleague Anuradha Schoff puts it, “an ecosystem where childlessness is the preferred option.”

Interviews and survey data from various East Asian countries show that part of the problem is extremely high housing costs — roughly twice or more as a percentage of income as in the United States, according to demographer Wendell Cox — and often pitiably small space. No surprise, then, that Asians coming to the United States flock to suburbs, increasingly in the more affordable parts of the country.

The extremely competitive work environment, which now includes growing numbers of well-educated females, is having a negative impact on birth rates. In 1970, less than half of women in Japan and Korea were working, and only one-fifth in Singapore. By 2004, that number had increased to three-quarters in Japan, and roughly three in five in South Korea and Singapore, notes NUS’ Gavin Jones. As one researcher in Singapore explained, how could it be possible for her to start a family when she has to compete with other women who are not so encumbered? It made no sense to her to have children, even if the state provided her with as much as a million dollars.

Huge time commitments at work, notes demographer Phil Longman, often work against potential parents. “As modern societies demand more and more investment in human capital,” he suggests” this demand threatens its own supply.”

Then there are distinctly cultural issues, such as the perceived unwillingness of many East Asian men to share child-raising duties with their wives. And among parents, the much-celebrated obsession with achievement and education — also generally favored by Mandarins around the region — tends to make child-bearing seem ever more onerous and expensive. In this sense, the Confucian ethic on education undermines its paramount familialistic values.

Japan represents the cutting edge of this lurch into what may in a decade be the general East Asian pattern. By 2010, a third of Japanese women entering their 30s were single, as were roughly one in five of those entering their 40s. That is roughly eight times the percentage in 1960, and twice as many as in 2000. By 2030, according to sociologist Mika Toyota, almost one in three Japanese males may be unmarried by age 50.

Lacking the innovative energy of new entrants into the workplace and the economic stimulus of expanding households, Japan’s economy has become ever more stagnant and inward looking. And most Japanese view the future as far from bright; the Japanese, according to Gallup, are now among the most pessimistic people on the planet. Not too far behind them are, surprisingly, the Singaporeans.

In Japan, the demographic clock is already ticking toward a kind of demographic doomsday. It’s been over two decades since the number of Japanese over 65 exceeded the number of those under 15, and the trajectory points to a time — by 2050 – when Japan will have 3.7 times as many people 65 and older as 15 and under, according to U.N. estimates. In 2050, the number of people over 80 will be 10% greater than the 15 and under population.

Even Tokyo faces Japan’s emerging demographic winter. Given current trends away from family formation, Tokyo, now the world’s most populous metropolitan area, may see its population drop from its current 35 million to roughly half that in 2100. By then Japan’s overall population could fall to 48 million, according to Japan’s National Institute of Population and Social Security Research. And what will be left of the Japanese will be very urban, very old, and at some point, probably well before, bereft of savings.

The other East Asian countries could face a similar fate, albeit a decade or two later. In Taiwan, 30% of women aged between 30 and 34 are single; only 30 years ago, just 2% of women were. In three decades, “remaining single and childless” merged from a rarity to a commonplace, and appears to be picking up momentum. In a 2011 poll of Taiwanese women under 50, a huge majority claimed they did not want children.

For its part, Singapore has been able to keep itself going largely by importing talent from abroad. But the mass migration of newcomers, who have increased tremendously as a portion of the population, has also sparked widespread resentment among Singaporeans faced with ever greater congestion, crowding, high property prices and ever-greater competition for good jobs.

Unlike intrinsically multicultural Singapore, Korea, Taiwan and China will struggle with the notion of tapping immigration to forestall their problems. As China progresses and urbanises, its demography increasingly mimics that of the Tigers, just as they now resemble Japan. Most of the world’s decline in children and young workers between 15 and 19 will take place in China; the People’s Republic will lose 60 million people under 15 years of age by 2050, approximately Italy’s population. It will gain nearly 190 million people 65 and over, approximately the population of Pakistan, which is the world’s fourth most populous country.

In the longer run, these countries will have to reconsider their priorities. In order to restore a sense of a prosperous future, they must first consider what factors would encourage families and child-bearing in their societies. This may, among other things, require “tiger Moms” and workaholic Dads, as well as the bureaucracy, to change their ways. As my Japanese mentor Jiro Tokuyama used to say, East Asia will have to unlearn the secrets of its past success.

Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and contributing editor to the City Journal in New York. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

This piece originally appeared in Forbes.

Happy Baby Photo by Bigstock.

The Braking Of The BRICs

Joel Kotkin — Fri, 05 Oct 2012 14:10:30 -0400

For over a decade, conventional wisdom has held that the future of the world economy rests on the rise of the so-called BRIC countries: Brazil, Russia, India, China (and, in some cases, with the addition of an ‘S’ for South Africa). A concept coined by Goldman Sachs economist Jim O’Neill, the BRICs were widely touted as the building blocks of the “post-American world.”

Such notions are particularly popular among intellectuals like India’s Brankaj Mishra, who sees world power shifting inexorably to “ascendant nations and peoples” — i.e. the BRICs — while “America’s retrenchment is inevitable.” Yet in reality, it is increasingly clear that the BRICs upward trajectory is slowing and many long-term trends suggest that their growth rates will continue to fall in the coming decades. Like other former “America-killers” such as Europe (1960s), Japan (1970s and 1980s) and the Asian Tigers (1990s), the BRIC countries appear to be unable to sustain the steady, inevitable progress projected by enthusiasts both at home and abroad.

One sign can be seen in the equity markets. Between 2001 and 2007, BRIC stocks soared, more than doubling in China and rising 369% in Brazil and 499% in India. Faith in the destiny of the BRICs grew even more after the world financial crisis, which these economies seemed to shrug off.

Yet more recently the edifice appears to have begun to erode, and in some cases, could well crumble. After rising almost fourfold from 2000 until the financial crisis, the BRICs’ stock-market value is at a three-year low.

This decline has impacted numerous key BRIC companies such as Petroleo Brasileiro SA, Brazil’s state-controlled oil company. This year it fell to the world’s 39th-largest company by market value from the 10th-biggest in July 2011. China Construction Bank Corp. dropped to 20th from 12th while Rosneft, Russia’s largest oil producer, sank to 106th from 70th. Shares of ICICI Bank Ltd., India’s second-biggest lender, have lost 17% during the past year, compared with an average gain of 9% for global peers.

Mutual funds that invest in BRIC equities, which recorded about $70 billion of inflows in the past decade, also have posted 16 straight weeks of withdrawals, losing a net $5.3 billion, EPFR Global data show.

This reflects serious, deep-seated problems in these economies. Brazilian consumer defaults increased to a 30-month high in May, while prices for Russia’s oil exports have dropped about 10% this year. In India, the central bank unexpectedly left interest rates unchanged last month after inflation accelerated. A gauge of Chinese manufacturing compiled by the government fell to a seven-month low in June.

The BRICS are learning — as the Japanese did before them — the meaning of gravity. With the dollar gaining value against the Brazilian real, Brazil could slip from the world’s sixth largest economy to seventh, overtaken again by the United Kingdom.

BRIC countries are suffering, in part, because of the slowdown in the European Union and North America. Depressed levels of spending in these export markets devastates these economies, in part because their domestic markets are not yet wealthy enough to support strong growth on their own.

Brazil has experienced a rampant property boom in recent years, with house prices in Rio trebling since 2008, and mortgage borrowing soaring. Reduced consumer demand could help drive the country’s economic growth rate to 2.2%, a pace more familiar in developed Western economies, and less than half the rate predicted by official government economists.

India seems to be drifting into a political crisis and remains handicapped by its deep-seated culture of corruption and favoritism. Malnutrition has increased — and is higher than in most African countries — while the political system creaks and blocks reform.

This is one reason why credit default swaps suggest India is already a bigger investment risk than emerging markets such as Vietnam and more than double the risk of Brazil, Russia, China and South Africa. India may also lose its investment-grade credit rating as Prime Minister Manmohan Singh’s administration struggles to curb a record trade deficit, a budget shortfall that exceeded targets and fighting within the ruling coalition, Standard & Poor’s and Fitch Ratings said last month.

In the short run, things are likely to get worse in India; S&P recently cut its forecast for growth in 2012 to 5.5% from 6.5%. Inflation running at 10% is sending investors fleeing from the rupee in favor of the dollar’s safety. Growth in industrial production fell from 9.7% in 2010 to 4.8% in 2011. The pace has slowed further in 2012.

BRIC member Russia, as Rodney Dangerfield would have put it, is no bargain either. The crippling problem Russia faces is an economy dependent on oil for 75% of its export income. In 2008 oil was 5% of Russia’s GDP; now it’s 12.5%.

As in India, corruption is pervasive, sparking political unrest against Vladimir Putin’s neo-czarist regime. Investment and retail has slowed down. At the same time Russia faces one of the steepest demographic declines on the planet, spurred by unusually low lifespans among males, with excessive drinking a prime contributor. Russia has lost nearly 10 million people since the collapse of the former Soviet Union. By 2050, the population could fall to as low as 126 million from 142 million in 2010. President Vladimir Putin has identified the demographic crisis as Russia’s “most urgent problem.”

Due to its one-child policy, China, too, faces the prospect of demographic decline. The U.S. Census Bureau estimates that China’s population will peak in 2026, and will then age faster than any country in the world besides Japan. Its rapid urbanization, expansion of education, and rising housing costs all will contribute to this process. Most of the world’s decline in children and young workers between 15 and 19 will take place in China during the balance of the century.

But China’s most pressing problems are more immediate. With exports slowing, China’s GDP growth has decelerated from 10.9% in 2010 to 9.5% in 2011. It is estimated by S&P to be 7.5% in 2012. China’s economic growth is set to slow for the ninth consecutive quarter. Schisms within the Communist Party, and growing labor and other unrest, make the Middle Kingdom somewhat less the inevitable replacement power to the U.S. that many have assumed.

South Africa is also pressed by political and economic problems.The economy is slowing down to a very un-BRIC like 2.7% growth rate. This is well below the heady 4% plus of 2011. And, as in China and India, instability, as seen in the recent, violent work stoppage of 26,000 workers at platinum mines, could further hurt growth.

With unemployment roughly at 25%, South Africa will hard pressed to remain an investment star in the years ahead.

So what now? Well, we can expect financial speculators, like Goldman Sachs, to keep trolling for the next thing. Wall Street’s most influential player recently coined a new term — MIST — to cover their new favorites: Mexico, Indonesia, South Korea and Turkey. One can only imagine how long this fixation will last, given the problems these countries face with either political violence and demographic decline, and in the case of Turkey both.

Of course, brokers hawking investments will continue to look for new places of opportunity. But as we are learning from the experience with the BRICS, not all emerging economies maintain their upward trajectory. Sometimes it might make more sense ,even given our inept political parties, to look at opportunities closer to home, where constitutional protections, a large domestic market and a diversified economy may provide better long-run prospects.

This piece originally appeared in Forbes.

BRIC country map by Filipe Menegaz.

Livable China

Lisa Gu — Fri, 31 Aug 2012 01:38:53 -0400

Recently, the McKinsey Global Institute published its report 'The Most Dynamic Cities in 2025' in Foreign Policy, a highly respected US journal. On this list, 27 mainland Chinese cities as well as Hong Kong took top spots alongside Shanghai and Beijing, leaving many other world-renowned metropolises far behind.

As a Chinese who has lived through China's transformation over the past two decades, I was hardly surprised by the results of this report. What really shocked me was the doubt and controversy that this report generated in western media, especially the negativity in the heated discussions published in the very same issue of Foreign Policy.

Among these, I was most taken aback by Mr. Isaac Stone Fish's article 'Unlivable Cities'. Having lived in several different Chinese cities over a 7-year period, Mr. Fish should be able to provide an objective prospective about China. Unfortunately, the takeaway from his article, in his own words is: 'For all their economic success, China's cities, with their lack of civil society, apocalyptic air pollution, snarling traffic, and suffocating state bureaucracy, are still terrible places to live.'

First of all, when it comes to civilization, there are very few countries where civil society can be traced back 5000 years like China. Today’s China may be in some aspects less civilized compared with the more developed countries, but China has come a long way in creating a more civilized society in recent years. When the People’s Republic of China was founded in 1949, the illiteracy rate was more than 80% in China, but as of today, the illiteracy rate among Chinese born after 1980 is under 1%. In cities, 80% of students go on to post-secondary studies. These highly educated young Chinese will undoubtedly redefine China's civilization. When it comes to parenting, the 80s generation, now mostly young parents, are studying how to be a parent, which would have been unheard of just a decade ago.

The new Chinese parents are teaching their kids to use polite expressions like ‘thank-you’ and ‘sorry’, something generally neglected in the past. Pioneer cities like Shanghai and Guangzhou opened ‘Manner and Etiquette’ classes in most of their primary and high schools starting in 2006. Our education system is changing as well, gradually switching from being purely exam-oriented, to cultivating students with all around abilities. Our future generations will continue to bring China into a new era of civil society. It is ironic for Mr. Fish to call China 'unlivable' by describing China as having 'lack of civil society', yet in his own narration later he wrote: 'Chinese cities have little crime, one can stroll safely through Beijing's magnificent Temple of the Sun park at midnight'. How many of today's ‘livable’ and ‘civilized’ North American cities can claim that?

Air pollution is an issue in China, but no different than the smog that hung in the sky in Pittsburgh, London, or Los Angeles when those cities were going through their own vast development phases. China is generating the greatest total greenhouse gas emissions in the world, but its greenhouse gas emission per capita in 2008 only ranks 78th of 214 countries in the world, while Australia ranks 11th, followed by USA (12th) and Canada (15th). China is manufacturing for the whole world, so in a sense it’s a scapegoat for countries that don’t want to or cannot make things for themselves. Yet even with that, air pollution in China never reaches the level described in Mr. Fish's article. Take Nanjing (300 km northwest of Shanghai) as an example: in the one week Mr. Fish spent there, the only thing he saw was 'smog the color of gargled milk'.

Having lived in Nanjing for almost 10 years, I do not find Nanjing's air quality unbearable. On the contrary, I love wondering on the streets of this ancient yet modern city, breathing the fresh air and enjoying the sweet scent given off by the Wutong Shu (Phoenix trees) erected on both sides of the streets. Every morning, citizens go outside to exercise in the mountains and parks. At night time, people take walks outside after dinner. Never would I suggest that Nanjing is an 'unlivable' city.

Phoenix Trees in Nanjing

In 2011, 14.5 million cars were sold in China. It has overtaken America as the largest automobile market. This has and will continue to cause significant traffic congestion, a worldwide issue most metropolises face today. However, China is very proactively providing solutions to this problem. In Beijing, Shanghai and Guangzhou, the local municipality limits the licenses plates issued every year in an attempt to relieve the burden caused by new traffic. Of course, China knows better than anybody that nothing will stop its citizens' desire for car ownership as they get richer, so the only way to prevent future traffic problems is to invest in more quality highways, cleaner cars and better public transit systems.

With China now spending approximately half a trillion dollars annually on infrastructure (9 percent of its GDP), visitors should not be surprised to see numerous highways and subways under construction in most Chinese cities. In 2010, Shanghai had the world's most extensive subway system (429 km), followed by London (402 km) and then Beijing (372 km). By 2020, the total length of Shanghai's subway lines will reach 877 km, more than double of New York's current total length of subway lines. Meanwhile, China provides large subsidies to the taxi and bus industries. On top of that, with the world's longest rail network, China's high-speed rail system is changing the way people travel between Chinese cities. The newest bullet train from Beijing to Shanghai can bring passengers to their destination in less than five hours, while flying over the terrain at a maximum speed slightly over 300 km per hour.

Bureaucracy has been rife in China literally for millennia, and the onset of a market economy has not changed that sad fact. Much of the criticism of China relates to censorship. Yet this is less an issue for most Chinese than for either westerners and some Chinese intellectuals. With the fast development of information science and the enormous variety of media available, people can freely choose what movie, play or art show they wish to watch, discuss anything they are interested in with their families and friends, and most importantly live the life styles they want. The 'pervasive fear of censorship' described by Mr. Fish literally does not exist for today's average Chinese citizen.

Mr. Fish also gave specific examples of 'unlivable' cities in China. Among them, Harbin, the capital city of Heilongjiang province, was voted the least livable metropolis mainly due to its cold winter. Personally, during my own time there, I was fascinated by Harbin's characteristic Russian architecture, the massive and astonishingly beautiful ice sculptures, and the fun winter activities that were available. All these temperaments make Harbin an extraordinary city. I am currently studying in Canada, a country justly famous for freezing winters. Constantly hearing Canadians complain about their 'unbearably cold' winters makes me realize that if winter temperature is a key criteria to judge whether a city is livable or not, Winnipeg, Manitoba would probably be crowned the most unlivable city in the Western hemisphere. I can only imagine what Mr. Fish would have to say about cities like Oslo, Helsinki, Copenhagen, or Minneapolis.

China clearly is no paradise, yet the world should recognize how significantly the quality of life has improved over the stereotypes of the past. Growing up in 40 square meter (430 square feet) 'Dormitory Style Housing' (as Mr. Fish put it), with my parents and grandparents, I remember vividly how our neighbors nearly burst through our door to see our newly purchased color TV, the first they had ever seen. My happiest moment was licking a popsicle to its last frozen drop in the summer heat. Considering my parents' combined monthly salary about 20 USD in the 1980s, this popsicle was quite a treat. Two decades later, in the same summer heat, my husband and I moved into a brand new three-bedroom condo in Nanjing, fully equipped with the most modern electronic appliances. Our condo is surrounded by a beautiful pond, a gymnasium, a supermarket and a nearby subway station. We make 3400 USD a month, eat out often and travel every year. This is not atypical for most middle-class Chinese people now. The welfare system is improving, people are less worried about getting sick, a retirement fund is in place, people now travel not only domestically but also internationally, and many send their children abroad to receive higher education. Where we are now would have been unthinkable to most people only a few decades ago.

I’m often deeply saddened by the way in which China is so often portrayed in western media. China’s growth and development over the past few decades has been vast, and it possesses potential for a more affluent future. Westerners may refer to China as ‘unlivable’ but for me, and hundreds of millions of people like me, China today is more than simply livable, and it will continue to improve as time goes by.

Lisa Gu is a 28 year old Chinese national who lived in Nanjing, China. She is currently studying at Wilfrid Laurier University in Waterloo, ON, Canada.

Photo by Wikicommons user shakiestone.

China's French Connection

Matthew Stevenson — Sun, 15 Jul 2012 09:26:44 -0400

No two countries would appear more divergent than France and China, especially in the age of Eurozone collapse. One country represents the Asian future, while the other is the capital of the failed, if diverting, old world.

The French recently elected a socialist president and assembly on the basis that everyone should share the country’s deficits and decline. The Chinese, meanwhile, have enough surpluses to buy out the European Union, should they wish to exchange their EU debts for an equity stake. (Maybe they will choose to have Paris shipped east in boxes?)

To take the measure of the two economies — although I admit this survey lacks academic rigor — I recently crossed each country by rail.

In China, I rode a succession of trains, high-speed and low, between Beijing and Hong Kong, with stops along the way in Yenan (Mao’s revolutionary capital), Xian (of Terra Cotta Warrior fame), Chongqing (Chiang Kai-shek’s wartime capital), Zhuzhou (a rail junction), Guangzhou (used to be Canton) and Shenzhen (the biggest city near Hong Kong you’ve never heard of).

I have also recently taken a number of train trips between Geneva and Bordeaux and crossed “France profonde” through the mountainous Massif Central, or gone on more roundabout routes through Toulouse and Tours.

My conclusions, which even I find surprising: France has a better balance between its land and cities, as well as richer farms and a more sustaining political culture, even if the presidency is a reality show.

China, at least from a train window, seems to be devoting most of its budget surpluses to moving the population into fifty-story, high-rise apartment buildings, the dormitories of its industrial revolution.

Like France, China has a high-speed rail network that travels on segregated tracks, allowing for speeds close to 200 miles per hour. I went from Zhuzhou to Guangzhou in about four hours, a trip that used to take overnight. The stations of the expanding high-speed Chinese network, however, are outside the downtowns of most cities, so getting to them feels like a trip to the airport.

Unlike trips in France, most intercity trips in China take place on slow night trains, with thousands of passengers tucked into open couchette berths. On my trip south, I was usually assigned the cramped middle bunk and rode, even during the day, like “John Malkovich” on floor 7½.

The French have largely given up on night trains. My regional train from Geneva to Bordeaux is a milk run (skim, I would say, to judge by the amenities), with beautiful views but few passengers. French high speed trains — Trains à Grande Vitesse or TVGs — do go downtown, although the French have the annoying habit of routing every trip through Paris.

In the current economic crisis, however, funding is being bled from the rails, and many TGV cars look thread-worn. Nevertheless, the TGV remains the inspiration for the Chinese high-speed system, perhaps because many Communist leaders had warm memories of their Paris underground cells.

Sadly, Chinese cities retain few of their French inspirations. Apart from old Beijing and some quarters of Shanghai, Xian and Guangzhou, Chinese cities are faithful to Maoist doctrine in that that they serve as worker housing and base camps for industrial output.

I may, however, be one of the few who prefers Beijing over Paris; the biking is better and the hotels are cheaper. Nevertheless, the average Chinese city is going the way of Los Angeles and Phoenix. The streets are less forgiving to cyclists, pedestrians, and kids playing after school. The outskirts of Chinese cities are great walls of housing projects that probably can be seen from the moon.

In France, because I often travel with a bike, during waits between trains I sometimes go for a downtown spin, which has allowed me to discover the old world charms of Orleans, Tours, Toulouse, and Blois.

Because French cities were laid out in the eighteenth and nineteenth century and not in 2003, they have narrow streets, often unsuitable for cars, but perfect for walking, bikes and sidewalk cafés. Bordeaux, a hive of narrow streets and small, self-contained neighborhoods, is an excellent example of a car-unfriendly French city that is flourishing.

Away from the glittering high-rise buildings in places like Dalian and Shanghai, much of train-window China remains a poor country, a succession of terraced subsistence farms, cut out of rocky hillsides and inevitably encased in a steamy fog. Elsewhere, China has the fault lines of runaway development: a population confined to worker housing, and agricultural provinces that are stripped for minerals or exports.

By comparison, French trains are never far from verdant pastures or neatly tended vineyards. Ironically, China's detached “people’s” government is the largest consumer of first-growth French wines.

The wine industry is one of the few meeting points where the French and the Chinese find harmony. China is now fifth (ahead of the U.K.) in wine consumption, and at the high end nearly all of it comes from Bordeaux and Burgundy. (The low end is a concoction of bootlegged Algerian and Rhône reds.) The reason that the wines of Château Lafite Rothschild can command $2000 a bottle is because newly coined Chinese millionaires find it a must-have brand.

Since France produces a surfeit of wines, the trade should stimulate the economies of both countries for a long time. Nevertheless, French producers live on the precipice of Chinese wine tariffs, should the Beijing government want to promote its own vineyards south of Shanghai at the exclusion of those in Pauillac.

Which country will fare better in the coming decades: China with its Dickensian economic juggernaut, or France with its budget deficits, despite having well-fed cows and landscapes worthy of Monet?

Just because my Geneva to Bordeaux train crosses through the contours of an Impressionist painting does not mean that France will return to its imperial glories. Nor do China’s traffic jams mean that it will dissolve into Manchu feudalism. Furthermore, to paraphrase Chou En-lai on the French revolution, it may be “too soon to tell” if Chinese communal capitalism will put an end to the party or to free enterprise.

Ironically, France does have the surplus of a self-contained economy, even if now it is in hock to German debt markets. Similarly, China has the deficits of post-Maoism—something close to the state capitalism of fascism—including that the best that can said of its Politburo is that it keeps the high-speed trains running on time.

Personally, I hope that both countries do well. I love that in each I can take trains, get around by bike, read about the Revolution or the Franco-Prussian war, enjoy the cities—especially Beijing and Bordeaux—and, well, drink French wines.

Photo: The new high-speed rail station, Zhuzhou, China; from the studio of Matthew Brady.

Matthew Stevenson, a contributing editor of Harper's Magazine, is the author of Remembering the Twentieth Century Limited, a collection of historical travel essays. His next book is Whistle-Stopping America.

China and the Future of Hong Kong

Adam Mayer — Wed, 11 Jul 2012 01:38:40 -0400

Last week Hong Kong’s new leader Leung Chun-ying was sworn into office by Chinese President Hu Jintao. The ceremony coincided with the 15th anniversary of the British handover of Hong Kong to China so there was plenty of rhetoric about ‘strengthening ties with the motherland’. Yet not far from the ceremony, tens of thousands of Hong Kong citizens marched in protest showing discontent with growing inequality and what they perceive as Beijing’s increasing assault on the territory.

The relationship between Hong Kong and mainland China is complex. Beijing for the most part has kept its promise to uphold the ‘one country, two systems’ mandate. Officially, Hong Kong is considered a ‘Special Administrative Region’ (SAR), which means that it is treated as a separate country from an immigration standpoint and continues to circulate its own currency, the Hong Kong dollar. Hong Kong also retains an independent legal and judicial system inherited from the previous British rulers.

Most importantly, Hong Kong has avoided the draconian media censorship common on the mainland. A free press is consistent with its reputation as a global center of banking and commerce. Hong Kong’s ease of trade and doing business frequently leads it to being named one of the world’s freest economies.

So if Beijing continues to hold up its end of the deal, why do so many Hong Kong residents march in protest? The relationship is more nuanced than it appears on the surface. Politically, Hong Kong residents do not have the freedom to elect their leader (CY Leung was appointed by a 1,200-person electoral college made up primarily of pro-China business leaders), although democratic elections are set to commence in the next five years. Underlying this frustration is what Hong Kong residents see as an infiltration of growing mainland influence on the city.

On the ground, Hong Kong experienced a huge increase in mainland tourists to the city since the handover. Hong Kong doesn’t have the same high tax rate on imported goods that mainland China does, so mainlanders flock to the city primarily for shopping, hunting for bargains on electronics and luxury fashion brands. It is not uncommon to see long queues of mainland tourists in front of shops of famous fashion brands like Gucci, D&G or Prada. The droves of mainland shoppers spending money in Hong Kong are great for the local economy, but many locals decry the constant flow of tourists as invading ‘locusts’.

Yet more significant than what is happening on the ground is what is taking place high above in the sky. The phenomenon of wealthy mainlanders purchasing real estate in the city has driven housing prices to astronomical levels, approaching the market just before the Asian Financial Crisis of 1997. For well-off Chinese mainlanders, Hong Kong real estate is seen as a safer long-term investment than China’s still somewhat risky real estate market and unpredictable stock market. A severely limited land supply coupled with the fact that a handful of powerful real estate oligarchs control the market for new development means that prices will probably stay high barring another economic crisis.

Land-use policy is perhaps the most critical factor in determining both the future of Hong Kong and the mainland. As anyone who has been to the city can attest to, Hong Kong has some of the best infrastructure in the world, including a first-class international airport, extensive rail system and a booming seaport. Much of that infrastructure comes from the city’s land-auctioning system, which is the government’s primary source of revenue. This is also what helps keeps taxes low.

Furthermore, unlike in the U.S., where infrastructure is traditionally financed publicly, Hong Kong’s infrastructure is increasingly built with private funds. For instance, the city’s Mass Transit Railway (MTR) Corporation, founded as a public entity, went fully private in 2000 and is traded on the Hong Kong’s stock exchange. In addition to operating and maintaining the city’s existing rail system, MTR Corporation is responsible for building new lines. What makes MTR Corporation different from most other transit authorities is that its primary earnings do not come from passenger ticket sales but from developing the land on top of and around its metro stations.

Cheung Kong Holdings, led by Hong Kong’s richest man Li Ka-shing, is not only one of the city’s largest property developers, its business interests also include Hutchinson Port Holdings (a port operator that handles 13% of the world’s container traffic) and Hutchinson Telecommunications Limited (which builds and operates mobile phone networks). Sun Hung Kai, another powerful Hong Kong property developer also owns stakes in logistics and telecommunications businesses (although its founders, the Kwok brothers, were recently arrested on corruption charges).

The mode of urban development in mainland Chinese cities is heavily influenced by Hong Kong. Yet instead of powerful corporations, State-Owned Enterprises (SOE), large entities owned by the government, dominate urban development related businesses. China’s land auctioning system is far from perfect, with well-documented instances of corrupt land seizures and the unfair advantages government backed SOEs have in the bidding process over private developers. But with virtually no property taxes in mainland cities, land sales remain the primary source of revenues for local governments to support infrastructure development.

There is growing evidence that suggests China plans to alter the direction of its development model in the coming years by consolidating and privatizing its SOEs. Already, Hong Kong property developers are active in the mainland real estate market with Chinese companies eager to learn from their expertise. The cozy relationship between Hong Kong developers and mainland SOEs is a cause for concern by Hong Kong citizens, as they see their local developers as more interested in appeasing Beijing authorities than providing affordable housing for its own citizens.

Yet this is inevitable. The city of 7 million cannot expect to forever be completely independent of a country of 1.3 billion to which it is now irrevocably attached. This is true even in spite of Hong Kong’s role as an international center of trade.

Throughout history, Chinese culture survived through its sheer mass and cultural osmosis. When CY Leung gave his inaugural speech last week, it was in Standard Mandarin, the official language of China. Although the citizens of Hong Kong are also Chinese, their official language is Cantonese, a completely different and not mutually intelligible dialect. Leung’s move was seen as a slight to the people he was chosen to serve, yet given who he has to report to in Beijing, it made perfect sense.

Adam Nathaniel Mayer is an architectural design professional from California. In addition to his job designing buildings he writes the China Urban Development Blog.

Follow him on Twitter: AdamNMayer

Hong Kong photo by BighStockphoto.com

The Beijing Bicycle: A Requiem

Matthew Stevenson — Sat, 23 Jun 2012 01:38:25 -0400

Just because China has 500 million bikes on the road or tucked away in sheds or courtyards does not mean the two-wheeler has a bright future there, especially in its largest cities.

Such is the growing indifference to the bike in China that no one seems to mind that the national model is manufactured in Taiwan (or under license on the mainland). With a single gear and heavy steel frame, the Giant is ideal for long rides on flat city streets. At a cost of US $180, it is the bike bargain of the world. Nevertheless, the dream for younger Chinese is a Honda scooter.

The problem now in Beijing, Xian, and Guangzhou, if not in the country at large, is that increased prosperity is making city bike riding that much more a thing of the past. Wonderful Asian bike cities like Hanoi have already been lost to the noisy scooter and small car. Is Beijing next?

Three years ago, Beijing was delightful by bike. Initially, I signed up with my friend George at Bicycle Kingdom to teach me the tricks of the narrow streets and the detours around Tiananmen Square. Ever since that first night of instruction, when we rolled out to the Olympic Park and down to the Temple of Heaven, I have been pedaling on my own power in Beijing and savoring every moment in the saddle.

One reason that biking in Beijing is such a pleasure is that riders are accorded privileges lost to those sitting in traffic jams or drifting around on tour buses. During the 60th anniversary of the Chinese Revolution, a bike got me a front row seat to the spectacle.

Beijing bikes have their own lanes, traffic lights, and rights-of-way, and a rider can easily thread his or her way anywhere. At railroad stations there are special bicycle parking lots, and even at the Forbidden City it is possible to leave your bike next to the front gate, as if you were a Mandarin.

A few of the parks are off-limits to riders, but to my mind the only way to explore the hutongs — the historic districts of old Beijing, laid out like rabbit warrens — is on a bike, with which it is possible to roll past tea houses, food stalls, and open shops, as if in a Venetian gondola.

Recently back in the capital, I spent a long day riding from Tiananmen Square out to Peking University, near the Summer Palace — about fifteen kilometers (a little more than nine miles) to the northwest.

I had mapped out my route using a mixture of back streets and boulevards, and rolled away to find the Beijing grave site of the American writer Edgar Snow, whose 1937 book, Red Star Over China, was the first English-language account of Mao Tse-tung and a reportorial classic. (They met near Yenan, to which I went by train, but where there are almost no bikes.)

To be sure, bike riding in Beijing is an acquired skill. I accept that it means weaving around buses, parked cars, delivery vans, and other obstacles. What surprised me on this long ride — about three hours in all — is how often the bikes lanes were flooded with motor scooters, cars, and a variety of motorized contraptions.

After a while, I had my eyes attuned to the demographics of bike riders. They tended to be school kids or the elderly. From this blacktop survey, I judged that middle-aged or prosperous Beijingers have little appetite for riding. Most were moving around on scooters, the kind that have clogged many Asian cities.

On earlier bike rides around Beijing, I found the experience sublime. This time it felt like I was riding for my life in New York City, outnumbered and outgunned by a variety of taxis, swerving motorists, and motorcyclists.

Not only is Beijing going the way of Bangkok and other Asian cities that have been lost to gridlock, but the effects of non-riding can been seen among the Chinese themselves, more of whom are obese; undoubtedly KFC and McDonalds don’t help, either.

Beijing is not the only Chinese city where I found biking on the wane. On my recent trip I also visited Xian, Chongqing, and Guangzhou, in search of Maoist redoubts and World War II battlefields. Chongqing (which has an excellent General Joseph Stilwell Museum and a Chou En-lai house) is built on hills, like San Francisco, so it has never been much of a bike city. Xian and Guangzhou are ideal for the bike, at least in their historic quarters. Yet each city is now overrun with cars.

In Xian, I spent a long time just trying to find a shop that would rent me a bike. I went to several where the owners just shrugged. Finally, I borrowed a neglected bike from a hostel, but first had to take it in for repairs. No one had ridden this Giant in weeks, and the seat was set for a Lilliputian.

You wouldn't cycle to see the Terra Cotta warriors on a local clunker, as they are an hour by car from the city. But a bike is perfect to explore the Muslim quarter or to take in the Xian Incident Museum, which tells the story of Chiang Kai-shek’s kidnapping in 1936 and his subsequent agreement to recognize the Communist party. (Nothing focuses the mind like a kidnapping.) In Guangzhou I made it to the Sun Yat-sen Museum, but the snarling traffic scared me into a taxi.

In Beijing and other cities, you still see bicycles loaded with garbage bags, cords of wood, furniture, dumplings, racks of clothing, and things like hundreds of fresh eggs. Some riders can comfortably bike around several family members on one frame, and it’s not unusual to see children following a parent through a busy intersection. In one alley, I biked alongside a man using his bike to move a large desk.

In Beijing and Xian, I especially love the cyclists who have rigged up devices so that they can ride around with their caged birds, although one cycling raven of my acquaintance just sat on a wooden perch across the handlebars. Where will he be in five or ten years? I hate to think that Edgar Allen Poe was a writing an elegy for, among other things, the Beijing bike:

Quoth the raven, “Nevermore.”

Photo: Raven on a Bicycle, Beijing, by the author.
Flickr Photo: Bird Scooter; birds and paraphernalia on a bike in Beijing by IstoletheTV.